Liz's UNOFFICIAL Notes: from 10/6/12 Board Meeting - Part 3 of 3

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Liz's UNOFFICIAL Notes: Board Meeting 10/6/12 - Part 3 of 3YEAR-END FINANCIAL REPORT: (Wilson)** I read a written report that I will provide to any of you who wants one if you send an e-mail request to forbesparkfriends@gmail.comThe board has never voted to allocate reserves based on our Audit report and there are things that can be moved around, for example, the picnic area down by Wagon Creek. It’s slated for $17K in reserves to re-build the pavilion but the board might decide to move that money into something we’re paying for like the grader. (Barth)A lot of the reserve work we’ve been doing is not coming out of the reserve, it’s been coming out of the operating side –repair work with culverts and berms. Properly we should be putting money in reserves and taking it out of that but we’ve been taking it out of the operating side so we didn’t need to replenish it in reserves. Maybe I’m wrong. (Waters)The $215,500 for reserves in the budget this year needs to go immediately into reserves and the landowners need to see it. Right now if you look at our accounting reports you can’t tell what’s in reserves and you can’t tell if spending came out of operating or reserves. We are addressing this and the Auditor will get after us if we don’t separate out our reserves and pay attention. Our bylaws state a super-majority of the board must vote to spend money out of reserves – four out of five directors. Unfortunately, a lot of the reserve money last year was depleted, bank accounts were closed and I can’t find a board vote that Okayed reserve money to be spent on the Admin. Building. There was $94,000 in reserves at the beginning of Oct, 2011. That bank account was closed by December and there is no vote as to where that money went. It showed up again later on in “Roads” but the board would have had to move that money into “Roads”. The paperwork and process was overlooked. (Barth) So…money was moved out of reserves to pay for the Admin. Building which totaled…. (Bunn)By the time you add in all the costs associated with the Admin. Building like the parking lot (about $5,000), the septic was dug (and that ended up in the Roads budget), and I don’t know how much the well was but the final cost is closer to $150,000. (Barth)We were told that money was not taken out of reserves for the building. (Bunn)We’ll have full accounting of it because we have 12 bank statements and we have copies of checks that were written to Pro-Shed and RMS and the numbers will speak for themselves. The landowners need to know this. It will be in the year-end report. It will be in the Audit Report and hopefully, going forward, the board will take these votes and make them public -- that money is being taken out of reserves for whatever reason.Where are the three CDs we are supposed to have – the actual certificates? (Bunn)Unfortunately, those CDs were not kept at the bank/s -- which is an option -- to keep them locked up at the bank. I don’t know why those were physically issued to Forbes Park but the certificates themselves are not in the records. Barth, Bunn and Colvin have all looked for them. It took a bank president’s sign-off to reissue the CDs. It became an issue. The only we could find is a statement by the former president saying that they were locked up in a safe at his home. We have the money. The money is not missing. It’s just the physical paper that said we owned it that is missing. (Barth)Audience: Are you saying that G. Fix did not turn over the CDs when he turned over his paperwork? (S. Roberts)Correct. And S. Colvin signed off on his papers and there’s nothing that says the CDs were physically there.  We don’t have a problem re-issuing them… (Barth)Have you asked him to return them? (Wilson) He said they were in the folders. He came in the office and looked through them and they weren’t there. I’m not making an accusation. I’m making a statement. We had them re-issued at the bank. (Barth)They were misplaced. (Waters)2013 BUDGET:There are some math errors in the budget. It doesn’t change anything that was voted on. Our assessments are the same. It’s just an accounting.  The top items – when you total your income and you total your expenses, they are supposed to add up. The top line “Repair and Replacement Fund” was originally $215,515.86 but, if you go to the bottom, it says $215,500. So it’s off by $15.86 so that has been adjusted. In the operating, if you total all of our expenses, we were off by $ 400.00 so I put in an unallocated line with $400.00 -- which was probably meant to be put into something, but it wasn’t. I’m making a motion to just clean up the math errors and have the 2013 Budget replaced on the website so everybody can see how the numbers add up. (Barth)Second (Waters). Is there any discussion?? (Barth)Audience: Regardless of how you do the formal accounting, if you could place a summary online that everyone can understand -- in layman’s terms-- so we can all see what things actually cost and can know what’s going on. (M. Schroetenboer)We can do that on big-ticket items. We can do a monthly report in addition to what the accountant gives us. L. Wilson can add some notes, on a monthly basis, and we can make an icon on our website if people are interested. I don’t know, down to the dollar, what we spent on the Admin. Building. When we get our Audit Report, we will know because it will move over to the asset side and we’ll depreciate it and budget for it in our reserves. (Barth)Let’s vote on cleaning up the math errors in our budget. (Barth). The vote was unanimous.NEW TILE IN CENTER:The previous ECC brought an estimate of around $2500.00 for the labor to remove the carpet and put in tile. With the materials, we figure it will cost about $5,000 total to replace the floor. So I make a motion that we take the money out of reserves and spend about $5000.00. It can go out for bid…whatever we want to do. Do I have a second? (Barth). I’ll second. (Waters)Is there any discussion on the floor? Do we want tile, carpet, corkboard? (Barth)Audience: What’s that going to do to the acoustics in here? (??)Loud. (Wilson)We only got a quote on ripping up the carpet and putting in tile. We didn’t get a quote on what kind of tile. I don’t want it to exceed $ 5000 so that will probably drive some of it. This is just one estimate. This is just to get it on the table. We might not have it for awhile and we can have other bids.Let’s vote. (Barth). The vote was unanimous.POLICY #4 (Bunn)Basically, anybody can ask for any kind of records that are in the office. There are some records that this does not apply to. But if it applies to purchasing equipment, contracts for services…you should be able to get any of that. This is an association and you should be able to know what you’re paying for. There’s a new bill coming out Jan 1 and you can just about anything you want with a few exceptions -- the same five restrictions as are already listed on the Policy we have now (read them from the policy). …And trade secrets (Waters)These are the ones that are listed in CCIOA. (Wilson)This is one of the statutes – an opinion we have from Motz. (Waters)I don’t think we have any trade secrets. (Wilson)The individual privacy addresses that because some contractors actually have their trade secrets in their contract. (Barth)And the reason for that is they don’t want their competition to know what they are charging – so they stay competitive. The only way around that is to go to them and ask if you can divulge it. (Waters)Mr. Motz suggested that you talk with the contractors on existing bids and contracts and that can get white-out so that a landowner can come and look. I do believe we have to disclose how much we are paying for the contract because it’s our money that is paying for those contracts. The landowner request that is on file now is a little difficult to get through because it says that, if you get a record, you have to destroy it within 30 days. I’d like to see this re-written between now and Jan 1 and we’ll have to follow that law. (Barth)I don’t think we need to make a motion. We just need owners to fill out a form and give us 5 days notice. You can’t have originals. You’ll have to pay for copies if you want them. (Bunn)The only real change is that you used to have to give a “proper purpose” to receive the records. What changes in HB1237 is that you no longer have to provide a “proper purpose”. You just need to give us notice so we can be prepared, get them ready, and make an appointment… (Wilson)Hopefully, we can get a lot of this available in electronic means of providing that information so that 2600 landowners that can’t come into the office or fill out forms can get what they need and that we can provide as long as the sensitive stuff has been taken out. Maybe we can put them on the website. (Barth)
POLICY # 7 - REVISION:We have to change this based on usurious laws in Colorado. The law says that you cannot charge more than 45% of the account balance when you go into collection on delinquent accounts. We can change the procedure so that we can have this in effect by Dec 1. Interest is in our covenants at 10% per annum.My motion is that the procedure for collecting delinquent accounts be revised to comply with the Colorado Laws including the 10% per annum which is required under Article VI in the FPLOA covenants.  On Dec 1, the first notice delinquency of $15.00 (late fee) and a payment plan should be offered as an option in the letter that goes to the landowner. Jan 1, the second notice goes out with a late fee of $20.00. Feb 1, a third notice goes out with a late fee of $25.00. And then on March 1 notice, the landowner will receive a certified letter with return receipt (so we know it’s been received) in which there will be notice that, according to our covenants, we can file a lien and we can also refer to legal counsel. It doesn’t mean we have to do these things at that point but we can. I need a second. (Barth)I second (Bunn). Is there any discussion on that? (Barth) Motion passed unanimously.BUGLER IN NOVEMBER: (Barth)I’d like to see the Bugler published by the end of November. There are laws that we have to get out in the Bugler – like the budget. D. Barrett wants to do it again and she does a great job. We’ll put out a mass e-mail for people to put some other things in it so it isn’t all business. We do have a budget for the Bugler.REINSTATE FINANCE COMMITTEE WITH NEW CHARTER: (Bunn)We used to have a Finance committee and it got changed but I think we need to put it back in effect. We need a group of people doing our budget, watching our money and making sure the board is doing what we’re supposed to be doing. I’ve asked B. Reid to chair this committee and J. Franke will help. We’d like to stay on track and have internal controls. (Bunn)In the charter I would like to see them report to the Treasurer and not to the President as our bylaws say. The bylaws now say they work with the president.  (Barth)Is that a motion? (Barth)  Yes (Skip). Is there any discussion? No? Then let’s vote. (Barth)Motion passed unanimously.Landowner Surveys: (Wilson)It’s been a while since an owner survey was done. I think it was 2005. I’d like to see folks suggesting ideas for what they would like to ask in a survey. Some people aren’t happy with the covenants or they feel like they need to be clarified. We have some historical data but maybe some things have changed -- or maybe they haven’t. But I think we need to find out what things people support and what they want to pay for. A survey is not a mandate. It’s just feedback. It may not be everybody but it would be more broad-based input. The more people we can involve the better chance we will have to make good decisions which are supported by more people. I’d like to see us put together a committee. Perhaps we could set up an e-mail address to collect ideas for survey questions. We could include a survey in mailings we already are sending rather than incurring extra expense. I would like to see us mail it with election materials so they could use the pre-paid envelope.I don’t think we can include it in election materials. They have to be anonymous. (Barth)The survey doesn’t have to have a name on it. It could be anonymous. (Wilson)I’d like to see it go out with assessments. (Barth)We’ve got the option to use the website for surveys also. What do you want to do? (Barth)I’d like to set up a separate board e-mail and start collecting ideas for survey questions. (Wilson)Would it be better to have it sent to the manager? (Waters) I ran on this and this is something I’d like to be in charge. I’d like to collect them – not culling them but collecting them and present them to the board. (Wilson)Talk with Jim Homer and see about setting this up. (Barth)Can I make a motion that I be allowed to do this? (Wilson) Second (Barth). Motion passed unanimously.ESTABLISH BOARD MEETING SCHEDULEOur bylaws only require two a year. I think we have to have a meeting in the spring because we’re talking election and we may be looking at election policy –candidates & timeline.  Right now I don’t see any need for a January board meeting. The dates I had are: Feb 23, April 27, July 27 and Oct 12 and the Annual meeting Saturday, July 6. I would like to get it on the calendar and in the Bugler. If we have it in February we’re getting close enough to talk about the election. That’s my preference. We can have some more discussion on that and we’ll get it out in the November Bugler so landowners can plan.Comments from the Audience:Audience: Something I’m concerned about and that we’re not talking about is… are we going to have 10% increases in assessments for the next five years or ten years? A lot of associations say “we want this” and “we want that” but we can’t keep doing that. We have an aging population that is on Social Security, 401s and whatever else.  In B. Reid’s time it was 5%. In my time it was 7%. We need to look at all the stuff we are buying and look into the future to see what we really need. Do we need 7%, 5%? Could we go one year at 0%? (M. Herring)That’ why we need a reserve study to help us budget for the future. We now have hard assets we have to save for – maintain, repair and replace. A lot of budget now is going to be driven by hard assets. (Wilson)I would recommend we have an auditor come in and do a forensic audit and I would like to know who signed off that we were a cattle and farm community. (M. Herring)G. Fix (Bunn)We’re taxed as residential – not agricultural. We had our lawyer, auditor and accountant advise us that we not sign off on that. We have to rely on the advice of professionals. (Barth)I’d like to emphasize that the majority does not always protect the rights of everybody. I agree with feedback but I want the board to do what is right. The people who are just landowners have the option of living here year-round. I bet if they did they would change their perspective somewhat. The rights we have been given upon purchasing our land need to be protected regardless of whether the majority agrees. (D. Armstrong)Absolutely. ..the board  has a fiduciary responsibility – of care and of loyalty. We also have to enforce and follow all of our governing documents. The ones that we can change, we should change because we have to follow the laws that trump those. (Barth)The only democracy we have here is when we vote. Then it is no longer a democracy and it is up to the board to make decisions and if we don’t like those decisions, then we vote you out. (D. Armstrong)The Guide to Building in the park shows it was submitted 3/6/2012. Has the board seen that and approved it? Because it seems to me there are some statements in there that look to conflict with Colorado Law and the Covenants and I’d like to see it rescinded. It says on the first page it was done by the ECC. And it’s on the webpage. It implies the board is supporting it. (R. Godfrey)I did not see a board vote and it might not even apply.  (Barth)Unfortunately the ECC is the most powerful committee here. The do what they want and don’t even report to us is my understanding. (Waters).We can replace them (Barth)We can replace them but they’re pretty well independent.We’ll make sure that comes off the website because it was not voted on. (Barth) Unless someone can show me the vote where it was approved it’s coming off the website.I think it was postponed for more study. (B. Moss)Then it should never have been put on the website. (Barth)The other option I would like to see on the other side of the firewall is all of the documents – not just the covenants whether they change or not.  (Barth)It is CCIOA law that sellers have to reveal all that to a potential buyer.  The onus is on the seller. The association is not responsible for doing that. The association is responsible for making the information available but we’re not responsible for revealing it to a potential buyer. (Wilson)Audience: We were provided with the covenants but we were not provided with the policies and the bylaws. How were we to know that some of the policies and bylaws were in conflict with the covenants? We read the covenants. We feel like everyone should be able to see all of this before they buy property. (D. Armstrong)At the last workshop I think we decided that we needed to receive a legal opinion from Mr. Motz about this and that still needs to be on his list. (Wilson)Audience: Are we going to move Forbes Park sales somewhere other than sharing it with the owners? I spent 2 ½ hours looking at property and they thought we would be willing to offer owner-financing like some of the owner’s do.   (B. Moss)It should be separated on the website (Barth). I agree (S. Bunn)I’d like to see them go back to open bids like we did in the past where we start with a good price and take the bids and have a closing sale and we got some money on that. It’s something to talk about with the Real Estate Committee. Okay. Is there a motion to Adjourn? (Barth)Motion to Adjourn (Bunn)Announcement: Thank you to the Rappers for the donation of the power saw to help with Fire Mitigation. (S. Colvin) <clapping>